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Uganda, like many African countries, suffers from an enormous trade deficit with China. Last year, according to UN figures, Uganda exported just $40 million worth of goods to China but imported more than $1.3 billion in return.

The government is taking measures to address the problem by leveraging one of its most valuable exports - coffee.

In a recent interview with The China Africa Project, Dr. Emmanuel Iyamulemye, the Managing Director at Uganda Coffee Development Authority (UCDA), revealed that “Uganda is coming to China in a big way.”

He revealed that Uganda’s coffee first arrived in China in 2003 through a joint venture with a Chinese company.

“We have learnt lessons over the years; we have just completed a coffee promotions strategy for China. We are looking at how Ugandan coffee can penetrate in China,” Iyamulemye says.

He adds that Uganda’s coffee roadmap of increasing coffee production from 3.5m bags to 20m bags by 2030 has been informed by lessons worldwide in terms of the market.

“For China, we are looking at a structured demand so that we offset the imports deficit by exports,” Iyamulemye reveals, adding: “With bi-lateral agreements, we believe this can happen. This is happening with Tanzania where they are growing cassava to supply starch to Chinese industries.”

Asked how UCDA intends to promote Ugandan coffee without spending much, Iyamulemye said they are looking at online platforms since youth can access internet. Therefore, online advertisement will be key.

He adds that Uganda’s focus is on high quality specialty and fine coffees.

“Our current strategy is threefold; specialty coffee-high end coffees- that means very high-quality premium coffees. That’s on one hand. We have another segment of commercial coffees for the average consumer…We are also looking at roasted and ground coffee which is our main focus so that we benefit the farmer who is producing the coffee,” Iyamulemye says, adding: “If we can have cooperatives or farmer groups which are exporting roasted and ground coffee, it will be very good because money will be coming directly in farmers’ pockets.”

He notes that UCDA is looking at ways of supporting the private sector to penetrate the Chinese market which will give the farmer a good place in the global trade.

“Ugandan coffee is now ranked 3^rd globally in terms of quality. We have big volumes so we can consistently supply the Chinese market (unlike some African countries),” he says.

“Even if we are exporting green beans, it should attract a premium price,” he says.

Applying Best Practices

On applying best agronomic practices, Iyamulemye says there’s a national coffee platform where coffee stakeholders share practices and lessons monthly.

“Because of climate change, we have realized shade grown coffee has a particular unique taste. It is also a mitigation to climate change,” he says.

Traditionally, coffee has been intercropped with banana plantain.

“Robusta is grown as forest crop. We are looking at shade trees to intercrop with coffee which comes with unique taste and aroma. We are also looking at productivity per tree, thus stumping, good and post-harvest practices are key. This is increasing production and quality of coffee,” he says.

With the new coffee law which will come into force soon, Iyamulemye says UCDA shall be facilitating farmers, buyers and exporters to increase production and exports whilst applying best practices.  

“We shall be registering farmers for traceability purposes. We also look at certification of organic coffee growers. We want to have Ugandan coffee differentiated as unique in terms of quality and consistency,” he says.

On capturing the China coffee market, the UCDA boss says they are discussing with China to have preferential treatment such as export quotas. “Our coffee shall be in high end coffee markets in China,” he emphasizes.

Farmer & Exporter Speaks Out

Frandan Tumukunde, a farmer and coffee marketing expert with extensive experience in China says the biggest challenge for Ugandan farmers is financing and as such, they are exploited by middlemen who buy coffee cheaply and sell it at exorbitant prices.

“If farmers are financed well, this will be overcome,” Tumukunde, who owns a Ugandan coffee brand that sells Ugandan coffee across Asia, says.

Tumukunde says he is happy that farming practices are improving.

“Uganda is the birth place of Robusta coffee and therefore Ugandan coffee is unique from other African coffees,” he says in reference to Uganda’s comparative advantage.

“Uganda is well placed according to the topography and high altitude because of the Equator; thus, we are producing good quality coffee,” he adds.

He says China has about 500m middle class people which Uganda can take advantage of.

“China is the youngest coffee market. Chinese have been drinking teas but are now shifting to drinking coffee,” he says.

He urges Ugandans especially the youth to grow more coffee and employ the best agronomic practices.

“Youth should take on coffee farming because the market is huge…China-Africa cooperation is good. If they can extend finance to the farmers, it will be good and kick out middlemen,” he says.

Increasing coffee exports to China

Uganda is looking to China to help quintuple the volume of coffee exports over the next five years. While that may sound ambitious, it may actually be achievable thanks to the surging demand for coffee in China’s largest and wealthiest cities.

China’s coffee market is estimated at US$11.5bn in annual sales and is expected to grow by 10% in the next five years.

Additionally, Coffee consumption in China is growing at between 15%-20% annually.  China is also Starbucks’ second largest market after the US.

Starbucks operates 4200 stores in China and plans to open up more 1800 stores in the next two years. 

Analysts say most of this growth is happening in tier one cities but inland cities (tier two/three cities) are yet to embrace coffee drinking.

Traditionally, Chinese have been drinking teas, but they are shifting to coffee given its aroma and unique taste.

To highlight how huge Chinese market is, in May this year, the Chinese bought 1.5 tonnes of Rwandan coffee beans within a minute in online auction.

With the increasing volumes of organically grown coffee, Uganda has an advantage over other African countries to capture the China coffee market.

Coffee is by far Uganda’s most important export as it generates 20%-30% of the country’s foreign exchange earnings.

According to Uganda Coffee Development Authority (UCDA) Coffee Roadmap, Uganda aims to produce 20m 60kg bags of coffee by 2030. This means that Uganda must look for market for the increasing coffee volumes. The China market is the new frontier. 

Ankole Diocese and Uganda Coffee Development Authority (UCDA) launched a partnership to improve household income through coffee growing targeting 46,000 households.

UCDA donated 22,500 coffee wilt disease resistant robusta seedlings to the diocese during the launch of the partnership on March, 9 2021 at Kinoni Archdeaconary in Rwampara district.

The seedlings will cover 50 acres out of the project target of 400 acres and will be planted on church land. The church will also establish demonstration gardens near the churches.

The Bishop of Ankole, Rt Rev Dr. Sheldon Mwesigwa, said supporting farming is part of the diocese’s community and household transformation agenda.

“We owe a big debt and we will be answerable to our God if we let our people continue to suffer in poverty. You can’t claim spiritual growth of a church when your people are languishing in poverty. We serve to grow our communities in spirit and economic growth,” he said.

Mr Sedrach Muhangi, the UCDA Regional Coffee Extension Officer, said they believe the Church can use its structures to improve the quantity and quality of the coffee produced in the region.

“The Church has well laid-structures and commands a big following. We believe it can be a reliable partner to improve coffee production,” Mr Muhangi said.

He said from the 22,500 seedlings, after maturity, the diocese can earn about Shs27 million in a season as each coffee plant can yield up to three kilogrammes of kase or Fair Average Quality (FAQ) coffee a season, which translates into 67,500kgs.

Mr Simon Kwikiriza, the head of household and transformation department at the diocese, said they target to establish a coffee processing factory in the next 10 years to encourage exportation.

The Rwampara Resident District Commissioner, Mr Emmy Kateera, said the project will not only boost household income but also help the Church that largely relies on believers for financial support.

“This is a well-thought intervention because some churches are becoming a burden to believers which is also hindering spiritual growth. Your Christians are poor but you demand thanksgiving, tithe and other contributions every Sunday. A believer who has no money has no alternative but to shun the church instead of suffering shame and stigma for failure to contribute money,” Mr Kateera said.

UCDA is working with different religious institutions across the country to promote coffee growing in line with the National Development Plan (NDP III) target of mindset change to promote development.

Uganda Coffee Development Authority (UCDA) has welcomed on board two private companies selected to benefit from a matching grant scheme from the European Union – East African Community Market Access Upgrade (EU-EAC MARKUP) programme.

The matching grant scheme under the EU-EAC MARKUP programme targets SMEs from the coffee and cocoa sub sectors for grants that will among others boost production, reduce harvest and post-harvest losses while allowing for increased market access and visibility for the products on the European Union and East African Community markets.

Speaking at an inception meeting held in the UCDA boardroom, Dr. Emmanuel Iyamulemye, UCDA’s Managing Director welcomed UGACOF and AINEA & Sons which are the first beneficiaries of six that were chosen for the scheme.

“This grant focuses on improving post-harvest handling practices. It aims at empowering the farmer. Therefore, I call on you to support farmers get good value for their [coffee and cocoa],” Dr. Emmanuel noted.

He also cautioned the beneficiaries to be keen on accountability.

“As government, we don’t want to have accountability issues. In case of challenges, write and seek clarification,” Dr. Iyamulemye said.

Juvenal Muhumuza, Assistant Commissioner, Ministry of Finance, Planning and Economic Development noted that the Ministry would support the beneficiaries achieve their goals.

“We at Ministry of Finance recognize coffee as one of the products that can turn the fortunes of this country and this has been reflected by the recent figures of coffee exports,” he said. “We want to promise you maximum cooperation and we look forward to working closely with you to achieve the intended objectives.”

The EU representative, Patrick Seruyange noted that it was a rigorous process to get the two grant beneficiaries on board and the two companies will work with government through UCDA which is the coordinating partner for the EU-EAC MARKUP programme.

The Market Access Upgrade Programme (MARKUP) is an initiative of the EAC Partner States funded by the EU and aims at addressing both supply side and market access constraints of some of the key export-oriented sectors, with particular focus on exports to the EU and ACP markets. In Uganda, the programme focuses on two commodities namely coffee and cocoa.

Specifically, the project will enhance market access to EU and the East African region by supporting private operators in the coffee and cocoa value chains to improve quality and quantity of the produce and retain premium prices for the same through niche markets.

The Uganda Coffee Development Authority (UCDA) is transitioning its Coffee Testing Laboratory in Lugogo to the new ISO/IEC 17025: 2017 standard issued by the International Standardization Organization (ISO) under the European Union funded Market Access Upgrade (MARKUP) project for the coffee and cocoa value chain development in Uganda.

The International Standard ISO/IEC17025 is used for the accreditation of competence of testing and calibration laboratories worldwide. According to ISO, all accredited laboratories in the world are supposed to transition to the new standard which will replace the ISO Standard ISO 17025:2005 in June 2021.

One of the result areas of the MARKUP project Programme estimate focuses on upgrading coffee certification and quality control services of the UCDA laboratories to achieve ISO 17025:2017 accreditation. After a competitive selection and evaluation using EU guidelines, ESQ Cert Uganda, an ISO Certification company, was awarded the contract for consultancy services to spearhead the process of accreditation. The process shall involve reviewing and upgrading the current laboratory documentation to meet the requirements of the new ISO/IEC 17025:2017 standard, capacity building of staff and training of internal auditors who will periodically verify effective implementation across the entire laboratory operations.

UCDA is working with ESQ Cert Uganda not only to build staff capacity but also to put in place systems for a smooth transition.

Currently, UCDA is recognized against the old version of ISO/IEC standard ISO 17025:2005. However, under MARKUP, ESQ Cert consultants will provide technical support to upgrade to the new version of ISO/IEC 17025:2017 which covers all activities of the UCDA laboratory.

Speaking during a 3-day capacity training building session for UCDA staff on Thursday 4 February 2021, Edmund Kananura, the UCDA Director Quality and Regulatory Services, said, “The accreditation will boost confidence in the results from our laboratories. It will also ensure that our laboratory operations are aligned with international processes. This will have a positive impact on our exports and build the image of Uganda coffee in global markets.”

According to Jean Atamba, a consultant from ESQ Cert Uganda Limited, accredited laboratories are recognized for their competence and abilities globally. This helps them to improve and monitor the operational process and to satisfy customer requirements.

The updated standard covers technical changes that have developed since 17025:2005 was adopted. The main changes incorporated in the 17025:2017 standard include focusing on the results of the processes instead of the list of actions “to be done”; better accounts for electronic forms of documentation, communication, and data storage and incorporating a risk-based approach. In addition, the scope of 17025:2017 has been revised to cover all laboratory activities including testing, calibration and the sampling associated with subsequent calibration and testing.

The ISO 17025 standard specifies the general requirements for the competence, impartiality and consistent operation of laboratories and is applicable to all organizations performing laboratory activities.